don't worry about the gold fluctuation and get an investing plan and go forward. for boston. i have a lot of great relatives out there. it's a tough town, ton of pride and we'll get through it and thoughts and prayers with boston. >> thank you both of you. appreciate it. >> "squawk on the street" begins right now. good wednesday, i'm carl quintanilla, jim cramer, david faber. a lot of corporate earnings today. some of them okay. some of them not so okay upon. implied open looks to be down again even as we had the so far this week the worst day of the year and then the second best day of the year. the volatility continuing today. europe's got some issues, as well. a lot of rampant rumors about various downgrades and a german bond auction that resulted on a record low of a ten-year of 128.

our road map begin with the marks looking like it's time to put your hands up and as we prep for the second decline in this roller coaster. it's up and down for two drills, cat getting a double dose of negative comments. >> bank of america dragging down the rest of that sector after it did miss us and it's the only consolation. profits were four times higher than a year ago on cost-cuts and fewer bad loans. >> there's intel beating by a penny last night and expects current revenue, and the decline in pc sales. >> the second consecutive quarters in a row. display ads leads to revenue misses at yahoo. that is, of course, the turnaround, but don't forget. there's always ali banna and we'll be talking about it. >> futures moving lower after the 157-point rebound in the dow yesterday. monday's 266-point slide. speaking of the industrials,

caterpillar lowering the price from 75 to 95 and from neutral to outperform on concerns about weakness in china. jim, they're calling it a multi-year decline in mining capex, and i'm not sure how that's new. >> this is what happened in 2008 and 2009 and you have credit problems for tat. 8.10 goes to 7.40. is it 12 times earnings and when earnings are coming down, multiples are very slippery things. i think the stock has found footing before 79 and 80. carl, i know you are the man of being able to figure out the calendar. tuesday is keeping its very good performance. >> yes. that was 14 consecutive tuesdays. who knows why? people like to make fun of it. they call it useless numerology.

>> when the moon is in the seventh house and it's tuesday. i will point out that the reaction yesterday really gathered steam during the day, and i think the idea that the futures must always key off of europe, they were down at 415. it was nonsense. yes, europe is bad and the car sales are horrendous. if you're ford you have to deal with down 15% over there. look, is bank of america horrendous? i don't know, let's listen to conference call. if we were to forget about europe and look at asia, the futures would be up. the futures have become automyselfed. >> what would that be? >> two losses by the nets in one night? >> no. i'm saying that asia is not that bad. let's look at american earnings, all right? american earnings, okay? and did you see u.s. airways breaking out yesterday? look, i continue to believe that if you take your cue from the

futures, what does it is a when coca-cola blows it away? >> although, on a day like today the negative comments on cat, textron -- >> even csx. their so-called operating ratio, the target gets lowered for 2015. are you seeing good things out of transports or industrials in general? >> csx does a really good breakdown. chemical foods, minerals, all good, phosphate's good and what's bad in dragging down anything? export coal. this is the death knell for coal this quarter and the epa has done it. export coal obviously, china's down. >> right. this is all china. we can trade csx off of china, but there is a trade going in this country out of coal into natural gas that is so fundamental and how could

norfolk southern be at 75. >> what's happening faster? csx and coal or intel and pcs? the tablet and i happen to like the cfo. he's a very nice man and you've got analysts opening questioning spending at intel. you have analysts saying intel missed the boat and they're very pc oriented and i come away and say if i'm michael dell and i listen to the intel call i would tell people who want dell. >> sold to you. >> bye-bye. >> what is that show on sunday? >> bye-bye. >> right. michael dell should say bye-bye. could you think ellison? could you give him half that island? >> let's talk a little bit more -- there's a look at michael. as jim's saying the world's first chipmaker reporting fourth quarter earnings. it was one cent below the many

analysts and the dow component forecasting a second-quarter revenue decline due to slowing pc sales and it does maintain the full-year forecast and last night on closing bell stacy smith outlined the company's spending strategy. >> the $12 billion that we'll invest in capital this year really is the core of our competitive advantage. it is the reason someone invests in us because we have the technology leadership, it manifests itself in products that lead the competition and allows us to win in markets. >> perhaps it's time to ramp that spending up, jim, to figure out other avenues in which they'll be able to deploy their chips. >> they cut it to 12 billion because they were able to reuse some of the factories. the interesting thing is goldman is saying you're spending three times what you're spending in 2009 and getting the same bang for the buck. intel which is a fabulous manufacturer, is spending too much money and not getting any reward for it.

they're paying good dividend while you're waiting. >> what are you waiting for? for ultra tablets? >> i think that comes out, gdot. it's not like they haven't figured out transitions in the past and what was the ability to do just that. >> ultimately, they've been able to reinvent and reinvent by making things smaller and smaller, another really nice guy, but this was supposed to be a good-bye swan song and instead it turned a rap on the call, i felt. i felt like people were saying gross margins were down 358 to 56 and you're levered to what? you're levered to the pc and that's gone away. stacy comes back and says listen, we're levered to the tablet and the ultra net and the touch screen and please don't think that that's going away and the tablet is on fire and i don't want to write-up intel.

i also think this stuff costs a lot of money to build. it's a huge story. >> meantime, bank of america dragging down the financialses and b of a earned 20 cents a share. the profits were four times last year's due to cost-cuts and less money being set aside to cover some bad loans. the bulls want to say, jim, today, and add litigation expense and those things are temporary and they'll go away, we hope. >> my goal is i want to go back to law school and become a lawyer for bank of america. this is the most remarkable quarter where j.p. morgan beat them in credit card and pnc beats them in all lines, but in the end we got them here at the conference call because i just don't believe too could be that sluggish or that merrill could have such bad trading. there is a code here and i don't have it yet. i just don't believe that bank of america is this bad.

i just don't think it's that much of an outlook. >> the stock is down, not a terrible move dunn. there was some litigation expense that perhaps was unexpected related to countrywide. the story in part has been let's release those litigation reserves that they've been building up, but not as much as had been hoped. that's still out there. >> you're taking a billion in costs and shouldn't you explore the earnings line? >> that's a lot of cost to take out, but you have to give credit, at least that they have been successful in doing what they said they would when it comes to costs. >> that's why i want to hear the conference call because i don't believe that this release is indicative like the wells release where i didn't like the mortgage line. the 87% that wasn't mortgage was good and john stomped on squawk tomorrow. >> the stock's up 40% in 12 months. >> right. if you've written this for a while, would this be a natural

time to step off? >> no, one of the things, and there was a lot of stuff on cnbc, with my charitable trust. how do you value it? what is the core earnings power of bank of america, and i think that's the problem and big money is trying to say what is the normalized earnings here? we've been saying that now for three years and that's been one of the arguments that the bulls have made while they suffereded enormous losses on the stock after they appeared to be healing and it wasn't. in part because of the huge mortgage litigation which they had chipped away at significantly. it's a great question. i don't know if we can get back to what is a normalized environment. what does that even mean? i can't value it. i don't know how to value. >> i think it's interesting, the mainstream press. the front page of the washington post is the spring swoon and how we cannot seem to escape this economic decline and we've seen the past couple of springs and the front page of the journal is

walmart and kohl's taking more time to pay their supplier, a trend they say is getting worse. those are not marginal positives, jim. i look at bank of america. i look at j.p. morgan and i say i'll pay 83.5 for 50,000 j & j. the trade is i don't want to mess with the stuff. proctor, look, he's making the quarter. he's going to make the quarter. >> raw costs coming down and coca-cola, by the way. raw costs are coming down, but they will come down. another one that is just where people are hiding. david, it's hide and don't seek. >> it is, but to carl's point, we've come out of the last few years and animal spirits start to feel strong. >> right. underlying economic growth is strong and everyone is revising up their gdp numbers up to three or three and a half. here we are again. it's april. i'm watching commoditieses come and wondering about

global growth. it isn't europe for sale although cyprus caused more issues. it may be the sequester or the payroll tax, and it is always something. first quarter strong. bond yields will go way up and then -- >> no m & a. i can't break the cycle. it's not my job. 18 straight months of re numbers in europe. there are car sales down 15, 16, our car sales 15 million, okay? their housing starts and did they start any housing there? are we not -- >> we are a different place. >> what about we've had some pretty crumby data. we've had an explosion in boston. we've had cyprus and the vix is still at 14. converge extries to argue that the market's on am bi18 and it can't feel what's going on in the world right now. >> i thought it was seroquil.

there is the market that just says kimberly is going to report, and i think kimberly is going to be decent and its stock's at par and then there's caterpillar they made their bed with china. china has not been able to stimulate. 25% of china's exports go to europe. there's no room in europe unless china sets up the buy program of all of the things they make in china and then destroys them in the 1930s in our country, right where we destroyed the pigs and they've got to destroy the picks. it's a new deal. >> destroy the pigs. that was not -- i was thinking about the new deal. i don't remember that being a part of fdr's plan to destroy the pigs. they needed to get prices up because of the deflationary environment and that's what we have right now and roosevelt was very clever. he did save the republic. remember, the center did hold.

>> yes, it did. >> good man. >> eisenhowerer, very underrated and the new yorker, we might add. >> hudson. >> he said he's british. >> you know churchill. i thought of churchill all morning because obviously, maggie thatcher. you wake up every morning thinking about churchill and why wouldn't you? >> since 1965 -- >> and weak up and smoke a cigar just as he did. >> the black bushnell. >> really? maybe next time you can invite david and me. you guys are open and i'm switching from jamison's. >> a little early for that. >> it is early, but not early if your over there. the guinness factory in ireland. >> the guinness factory. we go to the top floor where you get a couple of free guinnesses. >>ia he's revenue mistaking a toll in the stock in the pre-market. is the honeymoon over for marisa meyer. >> no!

>> also ahead an exclusive with the co-founder of cisco system, sandy learner. apple is about to test the bear market low. a lot more "squawk on the street" from post 9 when we return. [ engine revving ] ♪ [ male announcer ] every car we build must make adrenaline pump and pulses quicken. ♪ to help you not just to stay alive... but feel alive. the c-class is no exception. it's a mercedes-benz through and through. the 2013 c-class. starting at $35,350. departure. hertz gold plus rewards also offers ereturn-- our fastest way to return your car. just note your mileage and zap ! you're outta there ! we'll e-mail your receipt in a flash, too.

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>> some popular google apps experiencing service disruptions this morning. the problems apparently center

on three popular google apps, gmail, google drive and the admin control panel. a lot of people have tweeted about this this morning and google's website confirms the partial outage which appears to center on mobile applications. i had trouble logging in to gmail this morning. it doesn't happen a lot, but when it does it's news. >> i have my own server. >> really? >> i've had my own server since 1996. you heard about the chinese hacking people. >> i did. >> you get your own darn server and that stuff doesn't happen. >> i just write everything down with carrier pigeons and it's the most effective way. game of thrones kind of stuff. >> pornography, i'm not going talk about it. i know pornography when i see it. google? >> we want to talk about google. >> let's talk yahoo. the shares are falling in the pre-market. internet company reporting a first quarter revenue miss. yahoo sees revenues for the current quarter below concensus

and it did report profits of 38 cents a share and that was ahead of estimates and cnbc and yahoo do have a business alliance that we share and co-produce editorial content. only 30% of the value of this company is related to its core business. the rest is ali baba, and i don't know if you want to value it at 45 billion. >> ali baba for 45 billion. >> or 70 billion. -- or 70 billion where it goes public, many think it may, reach that value, but that's a key part of this equation as melissa -- marisa meyer has two years to kind of turn it around and has the cash to do it. >> and she point-blank said that. >> first of all, the boomerang which is the people who left yahoo and they're coming back. second, high quality and more personalized user experience she believes will result in increased user engagement and

this is the age-old debate on the web and do you therefore have a couple of extra bucks or do you clean up your site. she's going right. i think she's terrific. i loved this call. i also like that she believe, very googlelike, clean, crisp. >> and it wouldn't surprise me if share continued to fall. >> she says that, but i would also point out because of ali baba and the 45 billion she's got somelyway and the fact that they sold some of that position to help fund these efforts, but search and display. you don't want them to keep going down, down, down. >> as opposed to last quarter. >> 200 million goes to 300 million users and improvement in search. >> they're in mobile and competing against google and facebook. >> what do you want them to do? roll over and play dead? what would you do?

just become ali baba and spin it off? >> i would start drinking scotch again. that's what i would do. >> can you go with the lock of wool? you know what 7:00 p.m. in kathmandu. >> that's a big port there. >> that we know. we get a sell off one day or a rally the next? we'll get cramer's mad dash after the break. futures look negative again today and the volatility continues. opening bell is in eight and a half minutes. don't go away. in today's markets, a lot can happen in a second. with fidelity's guaranteed one-second trade execution, we route your order to up to 75 market centers to look for the best possible price -- maybe even better than you expected.

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a few minutes before the bell on a wednesday. we want to talk about cramer's mad dash. >> sirius first, which is an apple story. >> it was a major blow up and they make the high-end sound and to talk about inventory problems. sirius, this is a company that's not allowed to mention apple and no, it's apple having too much inventory and i don't regard this as new news. i'm sure people are saying an cell now bear market territory. is there anyone who doesn't know it? the apple guy in front is telling me these apples are fresher than the apple quarter. >> the consensus numbers need to come down. i once joked that the new products out of apple are terrible and @jimcramer. people think i'm serious. i think apple is a good company,

it's just not going to have a good quarter. okay? okay? shoot me! my fault! >> how about barclays about lulu. >> here's what i'm hearing about lulu. i am hearing that the recall actually generated a level of love for lulu, that the customers, instead of avoiding lulu because of the sheer problem no. they're going to lulu and barclays agrees. this stock has been -- look, this is where they recalled the stuff, carl. right here is where the pants didn't work. this is the pants recall! and it turns out they're pantsing the bears. the bears are pantsed. >> that's a good call. fairway hoping investors will go on a shopping spree today. if you don't know this chain, it's a grocery chain going public and largely centered in new york. get ready for day three in what has been a wild week for the markets. the opening bell in just four minutes.

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earnings have been checkered. europe, though, has had a dramatic morning especially the dax. >> look, europe is -- if they're not going do anything to stimulate growth, i mean, they're getting -- they're bordering on -- there was an article on whether austerity works or not. they're going to take austerity to a level and it just assures that they'll have a loss decade. >> and they did cut back from worrying about carbon so much. i know there were questions about reinhardt and the methodology they used to come up with a thesis to help government, and 90% of gdp, and now a couple of other economists taking issue with some of the statistical models. >> it's just an excel application, right? >> do you know how many times rogoff and reinhardt have been

quoted by everybody? >> you can have a depression if you continue this nonsense! it's nonsense! [ opening bell ringing ] >> he has the same level of unemployment that we had in 1934. >> yeah. >> it's crazy. >> greece even worse. there's the bell and looking at negative breadth. we're at the big board this morning. finra investor education foundation and the readiness program and over at the nasdaq, fairway, fooler in the greater new york city area celebrating its ipo. jim prices it at 13. >> people known to get married who meet in fairway aisles, you know that, right? >> they have, and people also beaten each other up in fairway aisles, as well. >> they get married in the tangerine aisle. >> and the narrow passageways they have on 74th street anyway.

and the one on 125th street. >> people who don't live in new york, there's a certain cult. >> yes. it's more than a whole foods cult and certainly more than a safeway cult and black hawk is coming. >> fairway itself, family run and then they sell out 80% of private equity which then expands the reach. fairway may be coming to you. >> we've seen from where walter rob comes with whole foods expansion they can bring up three times the number of scorers. >> and costco has been very measured in its expansion. >> fairway can use a little measure. >> textron is up more than 10%. they lowered guidance and bell helicopter is more of a military story, jim. it's not doing so hot. >> business jet has called and told us that the backlog for business is up very big. >> does that mean that general dynamics is taking share with the g-5 that i have not bought

yet. >> i don't know. get on that g-5, will you please? >> what are you using, lear, the seven? >> usually the subway, but occasionally the seven is right. >> mattel on the other hand is up more than 4%. american girl sales were up 30% plus, but barbie down for the first time in five quarters, just 2%. >> they need don draper to reinvigorate the barbie line. i do think the company has made the quarter and made the quarter. these guys are exceptional business people and i know when it was in the 20s and the dividends give you high yield and they've beaten hasbro and david, hasbro, there were always rumors that they can go private and they are above where people are thinking. >> there had been a talk although a lot of it was leading nowhere, but you're right about hasbro. >> the toy business, everyone said it would be done because of the ipad --

>> and i haved why. >> no. people -- grandparents love to buy grandchildren toys. that's a little nugget there. we should point out shares of apple are down 2% which exceeds the loss, for example, of yahoo and the equivalent of yahoo which reported a quarter of it. i don't know what the news driving it down. >> sirius logic, they're the big sound provider and they pre-announced about inventory backlog and the dogs are not eating apple phones and the dogs, if they don't like it they still don't teet. >> wow! >> that's just amazing for a stock that has a 52-week range of almost $300. the high's about 7.05. >> you think about the loss of market value? >> 620 billion in market cap at one point or somewhere in there. >> and then it went to 90.

no, it wasn't, but the loss of cap -- it was so enormous. it still is the second largest market cap company. >> the chart's broken and my charitable trust owns it and you know, give me a break. this is an inexpensive stock, but like bank of america, it's very hard to fear to devalue the numbers being cut. >> the two numbers that have the axe knell are freddy krueger and jason because they do have the axe and it's just to work and the company's been quiet and there's a lot of talk that they will have a dividend. >> it's overseas. it's overseas, most of the skash is overseas. >> they're still willing to bring it back. yahoo is willing to bring some of the ali baba proceeds and have them back. however, 35%, 40%, that's a lot to pay if you can avoid it or if you think there's going to be a change in the future. apple is still the largest market cap company because exxon

mobil is down. >> given what oil's done. under a hundred. i had floyd wilson on last night. he's the ceo of halcon. he sold petrol off to bphp, and you are finally seeing the world price being impacted by our output. it's finally happening. don't forget, the bakken, north dakota, more than 750,000 barrels a day. this is one of the reasons why oil is coming down, not just china demand and it was the first time i'd heard any ceosey say it. >> the monday's low on crude was 87.58, you have to watch refiners here, jim? >> you have to be careful with refiners because they can get squeezed here if you get the oil. it's no longer trapped in the midwest where they've been buying it cheaply and then using the brent price to sell it to you at the pump. that's going away, that trade,

and i would point out that gasoline going down is a good thing and it is going go lower just in the summer driving season and it will make up for the payroll tax holiday. i hate to be kill joy when you're satternine. >> or serpentine. >> hey, jim, so monday down 2.60. tuesday up 150, today down 100. someone argued that this means there are dislooks that show the market is unhealthy. >> i want to wait until 10:15 when the japanese are coming in and they always reach for the same stocks. you see lil lil suddenly gets footing. >> it's not 1987. >> you're, like, having flashbacks. >> i loved 87. >> every year, you took off earliy and started summer vacation early. >> '89 is when i went to martha's vineyard and started going to martha's vineyard for

the summer. if you were up a certain amount, go away. >> let's get to pisani on what's shaping up to be another eventful day. >> i don't like the fact that you're seeing materials under attack. >> steel miners are down and most of the whole stocks are down and a lot of the energy stocks are to the down side. consumer staples are again, a defensive day by and large. the big question i got early this morning is what the heck happened in germany? i don't have an answer for you, and some people are calling it a mini flash crash. the dax dropped 180 points in like, eight minutes right after the open and i don't have an explanation and there is a series floating around about fat figure trades and it was very unusual to see that. germany is now down eight in a row and we are are down 1.7% in germany. france was down 1.5% and there were many knock-on effects as a result of this and that's all i

can tell you about it. carl, i think you were mentioning these ping-pong markets and that's the other big topic overnight. so you are down 234 on monday and you're up 160 on tuesday. you are down 103 on wednesday here and it's very tough for active traders to take positions. you get a lot of complaints about this stuff. you get stripped out every day depending on which side you're buying protection on, going long or going short and it's hard to take positions and it gets frustrating for active traders and of course, you can stand back and do nothing, but you don't stand back and do nothing. this kind of market activity makes it tough psychologically for everybody. on the earnings front, it's been okay. i saw burberry had very good numbers in london and the luxury goods sector. lvmh had lousy numbers. i don't know what to make of that. they're a little bit erratic and it's early to have clear trends and i agree with your points about textron. that's a big multi-industry company and i love the companies

because they work across many different businesses and remember something, textron is largely aerospace and defense. you have two disappointments there with them and both of them are -- yes, aerospace and defense. i'll tell you a better company to watch, jim in the industry, dover. dover just reported their big different kinds of stuff, consumer electronics and pumps, compressors and tools and all of those things that go behind the walls. their numbers were quite different. they did pretty well and they reiterated their 2013 guidance and all of the multiindustry names were basically down on textron today and that might be a better company to watch because they're not so involved in the aerospace or defense area. big week for the ipo and glad you guys put up fairway. they upped the price here at $13.7 million shares of 13. that's good for the company and not so good for the people who want to get in. remember tomorrow, big day. we'll have intel sat, biggest satellite company in the world

right here at the new york stock exchange going public and we should also have pricing for seaworld as well. these are two big brand names and the ipo markets are hot right now and a lot of them are doing fairly well. we are down 20% in gold stocks this week? deutsche bank upgraded a couple of big south african gold names and the key thing, jim, and i'm sure you talked about this, huge price differences in the production costs of different companies. some companies produce as much as $800 an ounce and some of them reduce their 1600, $1700 an ounce with gold at 1300 now becomes very important and picking the right companies and the right low-cost producers now becomes very critical. back to you. >> couldn't be more right. barrett having trouble finding gold corp. listen, the mining costs have gone up. burberry opened a lot of shows in china and they claim that helped them make their quarter. china. >> let's shift to bonds and the

there are and at the cme group in chicago. >> good morning. everybody's been talking about all of the issues we hear on this floor. some of the big bourses in europe are now down on the year, but let's start with tens. look at this chart. we've had a lot of volatility, but you see that drop in rates on that chart? the laughter may be 5:00, 6:00 in the morning? take a look at the dax. bob talked about it and some are talking about the dax flash crash and down here it is the water cooler topic. see that chart here? but here's where it really starts to get fascinating. open that chart up on december 10 on the dax because that was the last time it was here and i'm sure that's a coincidence. we are hovering at yields, you guessed it, the yield since december 11th and there is harmony in the central banks aside. let's switch gores a bit and we hand we were down 1.75% and the

dax, we were down 1.4 in the gap. we need to pay attention here and we are the cleanest shirt in a very smellies closs net many ways and i'd like to concentrate on the dollar index. look at the two-day chart of the dollar index. yesterday was one of the rare occasions we closed under 82. it hasn't happened since about the end of february and the one-month chart, clearly see there is rotation and that is a pattern very few technicians want to be bold enough to catch and we need to monitor not only the euro, but of course, the yen. back to you. >> let's check out the latest moves in the energy and the metalses. sharon epperson at the nasdaq. >> below $100 a barrel and concerns about global growth pressuring oil prices and we did get from the american petroleum know stut last night showing a bullish sign and even that was not enough to be supportive at the moment. traders continue to watch the levels that we're seeing here in the wti market as well and

they're looking as well at the latest fuel demand that we're seeing in the u.s. and china as reasons for lower oil prices. keep in mind as we look at the gold price and it is slightly lower, there is a bit of concern still about what will happen in terms of gold sales in cyprus. the latest from the finance minister saying he sees gold sales happening within months and it all comes down to what the central bank determines and it was definitely one of the cat lives to the gold sell-off and this is something that traders are watching carefully, we're watching metals lower across the board and we'll see whether or not we'll see more buyers come in, some including barclays saying that will not happen until it's 13.20 for gold. >> time to go overseas a bit and talk about consolidation in the cable industry. the european cable/buy baaned provider con fwrield john malone

has been no stranger overseas, having inked a deal to buy virgin media and that deal to close in the not too distant future and you see the reports out of germany that they're not done yet at liberty global and they want to move to cable deutschland which is the largest provider in that country. now these reports having been repeated by other news organizations. i can tell you that my checking doesn't indicate there's much to it right now, that, in fact, that there is -- it doesn't appear that there is anything going on at the moment. that being said, this has always been something that liberty global has been potentially interested in doing if it could get the regulatory appeasement it needs in order to do so. i asked john malone who controls liberty global about liberty global's consolidation plans in europe when i interviewed him last week. >> there are two obvious consolidations still ahead for

liberty global in its european footprint. one is the rest of holland. >> right. >> you've taken a modest stake. >> yeah. the other would be the rest of germany and that's a regulatory iss issue. >> there would be enormous synergies in creating a language entity that would cover all of german speaking, central europe, and both parts of germany. >> right. so i'm not sure when the regulars would let us combine with kdj, the ability to get into other businesses to give deutsche telekom full competition across the full footprint, i think would be very beneficial for the german consumer and the german business base. it is always nice when it works out that way and you ask a

question and you haven't used it and some news comes up. >> great scoop, david. >> it makes a lot of sense, but whether there is anything going on now is very careful. >> maybe one of the most brilliant men ever with a balance sheet is taking advantage of the weakness in europe. no one is else. this guy's going over, everyone else is fleeing europe and he's making the determination that one day it's going come back because he has the fortitude. >> he does, and he believes -- he actually says the economy is not bad for their customer base as you might think. in an environment like this malone cease cheap money and the ability to lever up cash flow-producing businesses and he will keep doing that and liberty global will be leveled high. you get to some high levels in terms of how much debt versus how much cash flow you have. nonetheless, that's a strategy and that continues to be one. >> use it. use it. use it. >> everyone always talks about how they've got to go overseas and then they pay too much.

here's a guy who is going in and he's not paying too much. he is down substantially and any time you ever listen to a conference call, it's, like, woe is me, and here's a guy that says i'm taking advantage of it and that means to me that there will be a bottom because he's too smart to bet against them. >> we'll meet coat-directors of a documentary on bernie madoff said to premiere at new york's tribeca film festival. the dow is down 108, reversing what we got yesterday. back in a minute. ♪

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siemens. answers. >> take a look at the dow 30. we have four components in the green led by j & j. what a surprise. we are also keeping a close eye on apple, of course, down more than 2%. 416.93 as two firms, i think it's lazard and goldman having comments about the march and

june quarter. remember, they do come in and buy. i know you ridiculed me for that, but that's not the first time. i wouldn't call it ridicule. you looked a scans. >> let's explain why you continue to reference the idea that the japanese are coming into our market. >> between 10 and 11. >> and the boj is buying lots of things and to my knowledge they don't include u.s. e quites. >> the people see the sham for what it is and they put their money here. to me it's a sham. it's a sham wow, frankly. it's sham wow here. and shamu comes public tomorrow. the whole thing is about the sham. and shamu yields 3%. remember, cedar fairs has a good yield and he's doing quite well. celgene is the stock to watch. that stock has been bulletproof. keep an eye on walmart.

tesco basically throwing in the towel on the u.s. market. safeway should go with vacations. i watched the ceo be interviewed and it was humbling. humbling and that's a big reversal. the stock got hammered. still to come, ford has a better idea when it comes to boosting sales in china. will the automakers plan on taking gm across the pacific payoff? fill lebeau is there and sean king and we'll talk to him, but first -- coming up, launching into a market like this can be tough, but we have someone here who can help minimize the damage. jim kramer and six stocks in 60 seconds. he may just give you the lift you're looking for when "squawk on the street" returns.

time for six in 60. six stocks, 60 successes. >> express scripps on the board. >> these are the kinds of stocks that work in this environment. >> united reynold, uri. >> people are worried about

cater pell ar. >> all of the analysts downgraded here, pound sand, analysts. >> j & j. >> they won a lawsuit. they had lost it, same thing in l.a. and they won. i couldn't believe it, they won. this company is charmed. it can do no wrong. work day. >> how can this -- this is the most expensive stock in the book, but the software is a service. >> yes. it is so expensive and tgt, is imwill bell on for target. target missed the quarter. how much is it down since it missed? 11 cents. >> it says target's going to reaction cell rate. >> do you think that's true? >> i don't bet against target. i like to shop there too much. >> what do you have on mad tonight? >> core labs, the intellectual property behind so much of the shale drilling. i asked mr. smith to come on because they did a 42 and the stock went up four points and that's worth applauding.

secondaries and ipos have been amazing. >> we have fairway today, realty was extraordinary ipo and you pointed out they were able to withstand that secondary. >> i couldn't believe it. obviously, real estate, there are a lot of people going back and forth about whether housing's peaked. why don't we ask him? he sells the most. >> don't forget, tomorrow night, dinner. >> that's a night. >> are you buying? >> all right. simon, over to you. >> what about the rest of us? we're coming, as well. in the next hour of "squawk on the street" we will talk to the woman who is co-founder of cisco. sandy lerner will be on cnbc. we're down almost triple digits and have we broken the bull run? jeff will be here to talk about that and grab the popcorn, two of the co-directors of the bernie madoff documentiry. oh, yes, that will also be here in the next hour of "squawk on the street." [ male announcer ] there are people who find their own path.

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[ engine revs ] ♪ at bny mellon, our business is investments. managing them, moving them, making them work. we oversee 20% of the world's financial assets. and that gives us scale and insight no one else has. investment management combined with investment servicing. bringing the power of investments to people's lives. invested in the world. bny mellon. at a hertz expressrent kiosk, you can rent a car without a reservation... and without a line. now that's a fast car. it's just another way you'll be traveling at the speed of hertz. welcnew york state, where cutting taxes for families and businesses

is our business. we've reduced taxes and lowered costs to save businesses more than two billion dollars to grow jobs, cut middle class income taxes to the lowest rate in sixty years, and we're creating tax free zones for business startups. the new new york is working creating tens of thousands of new businesses, and we're just getting started. to grow or start your business visit thenewny.com >> welcome back to "squawk on the street." we begin with the markets and another big slide for the dow after the s&p yesterday logged

its second-best one-day performance for the year. earnings from b of a, yahoo not helping the situation. how can you play the markets as volatility now kicks into higher gear. plus blue nile president harvey cantor is he benefitting from gold's week. we're going behind the scenes of a madoff documentary premiering this friday at the tribekka film festival. we want to bring in gordon charloff of rosenblat securities and also a cnbc market analyst. good to see you, sir. >> you have to get used to the triple-digit moves. >> it makes things interesting for us down here on the floor. >> look, it started today. rumors of a german debt downgrade and it spooked europe and we followed through in new york in the united states. obviously, we had the movement in gold earlier in the week, so what are we seeing here? maybe we're starting to see the inevitable equity pullback that

a lot of the traders were waiting for. >> short of that, we're certainly seeing somewhat of a reticence for the guys to buy the dip as aggressively as they had been over the last month or two months and sort of a paradigm shift in the way investors are treating the market. >> it feels different than it did post-cyprus where we hadda i dip, the news was bad for a limited window and people bought. >> today, you've seen the patience and the ratio losers to winners and you're just getting that sense and we're seeing sellers being more aggressive and we're seeing the buyers being more selective, so again, a little bit of a shift in the psychology of the market coming into effect right here. look, when you have the kind of move to the upside that you've had, carl, you know that at some point we're going to get the pullback. the question is when with will that come, not if. >> april continues to be the dow's best month, and i don't think we've had a lower april in

six or seven years and then there's may and a lot of front-page coverage about how the spring swoon appears to be alive and well. maybe some guys are trying to get ahead of that and get out toward the end of april and make the move. >> do you think we're still looking at the fallout from equitieses from metals? >> is that still in effect today? >> the commodity pictures is one that's murky. >> we've been trying to understand exactly what's with precipitated the sell-off not just with goldman and commodities across the board and the effect that that's had. oil and the transports and all those kinds of things, so you know, yeah. you have to factor in everything that's coming on and trying to understand when we'll see that avalanche poke at us and we'll see the pullback that the guys have been looking for, the inevitable pullback. >> it still makes you wonder, gordon, say you're losing patience with equities and then what? where do you go? you will buy the german tenure

at one-two. that question hasn't gone away. where else can you go? where can investors go that they feel there will be some safety and also a little bit of sxrifk there seems to be a little bit of change in the risk profile right now. guys are starting to back off the risk so, yeah, the yields are where they are, but guys are still buying credit. >> we'll see what the afternoon brings and maybe the tone will be different and we'll find out, always good to see you, gordon. thank you. >> david, over to you. >> let's dig back to bank of america's results and the share ises are down 3.5%. sow you see it right there and it did miss in earnings per share although it did have higher revenues and the managing director of u.s. banks at credit suisse and it has a neutral rating at bank of america and the target price right around where weir right here. first of all, give me your take on the quarter. >> sure, david. the quarter was okay. i think expenses were roughly in line with what we've had although some people were looking for a little less and it

was light on the fee revenue side. >> what about -- i'm sorry. in terms of credit issueses, and actually a couple of different issues here. they do feel they've done a fairly good job taking down expenses and there is some concern on the flip side about their consumer business where loans were not up, but actually down. >> right. >> i think the consumer business has been a lagging problem that will still be with them as long as interest rates are low. they've had a revenue problem there so i would say that's going to be an issue. in terms of expenses they have about $1 billion that's compx pences that hit in the first quarter. so with that they were roughly in line with our expectations. >> investors seem to keep waiting for the litigation cloud to completely dissipate and this quarter, i think we have something that perhaps might not have been anticipated in terms of country wide litigation. are we through that with bank of america or is that something that you have to continue to expect quarter after quarter. >> there are three or four large

lawsuits that still have to be resolved and so while they've provided some of the costs of that, i think that's going to be something that for the next year or two that will be indicated. >> that interest margin did improve a bit and long-term debt, higher commercial loan balances and i can't imagine that's going much of anywhere given the loan rate environment. >> it will bounce around in general. >> okay. i think we lost his oaudio, buti want to thank him for joining us on the somewhat shortened interview. >> let's get the latest on tragedy in boston this morning. investigators appear no closer to finding a suspect, but are learning more about the bombs that were used. our scott cohn is live once again in boston covering the latest. scott, what's the news today? >> well, carl, we have some new pictures now of fragments of the bombs and the other things that were associated with them. some of these are pretty

chilling. as you will see, there are ball bearings, nail, the shrapnel that was used and also fragments of the pressure cooker and that apparently was the delivery device for this -- at least one of the bombs and possibly both of them. these are very important clues, but of course, people are still trying to get more information. the authorities are appealing to the public for video, for information and any ideas about who might have done this and at the same time they're looking at the way that security was handled and has been handled for the boston marathon. tight security and despite what happened, the police commissioner here is defending that security plan. this particular plan was very well thought out and executed and there were more offices assigned to this race than there were ever assigned before and we were particularly concerned with the finish line this year and

assigned more offices down in that area. >> nonetheless, when you talk to people in and around this area who have been here for a long time and you listen to what the reaction was right after the blast, the question arises, had people become complacent? >> i heard the noise, and never thought that that was a bomb. >> reporter: indeed -- indeed people have -- sorry. the finish line of the boston marathon is normally a very festive place. it is very easy to go there especially a couple of hours after the elite runners have crossed the finish line and while there is security there, there are no bag checks. >> boston is a college town and you walk around with sneakers and a backpack and on this day in particular.

the police commissioner said that there were undercover officers around the finish line, but acknowledge that mainly they were there to look for pick pockets. carl? >> scott, thank you for that. a lot of developments to keep track of and we'll come back to you soon. our scott cohn in boston. we are getting footage from london of mickey arison. it's the first time the embattled billionaire has been seen in public since he offered to write a check to reimburse u.s. cut of -- that after the senate commerce committee, jay rockefeller accused mickey arison of blood sucking off of the american people for not refunding the cost of the coast guard and navy rushing to his now 90 incidents at sea in five years. >> carnival will now spend $300 million on new emergency power capabilities and new fire safety technology on the 24 ships that

carry the carnival brand. another potentially $400 million could be spent extending enhancements to the 77 other ships that sail under the group's princess, costa, holland america and the quinard brands. beyond that, there will be a shake-up of the empire because mickey arison remains a shareholder in addition to being the chairman and ceo, although his 71-year-old longtime coo may well step down. goldman sachs warned overnight that because mickey arison has 15% of the world market, the rice cuts and promotional activity that he's ordered to keep carnival ships full after so much bad publicity will now impact earnings statements due from his two smaller rivals, royal caribbean and norwegian which, of course, recently ipoed on the nasdaq, david. >> thanks, simon. >> we have a mover in the technology arena.

>> let's send it over to josh lipton. check out apple which is making a new 52-week low and now down 40% from the record high and just spoke to the technical strategist at rbc and said the stock in an established downtrend now taking off another month and a half in training support and also importantly the relative performance to the market in the sector is break out to multi-month levels followed by 365. brian blair says the catalyst for today's sell-off was the negative preannouncement from apple supplier cirrus logic. the stock right now down 3.4%. simon, back to you. >> thank you very much, josh. first the 265-point drop on monday and then a triple-digit rally pulled back the next day and now we're down another triple digits. we're all over the place. how do you play markets now that the volatility is back? chief investment strategist with

raymond james will lay out his action plan for you next. plus an exclusive with the cisco co-founder sandy lerner. we'll get her thoughts on the future of tech, both old and new. but first -- >> i'm phil lebeau in chongqing, china, where a new ford is rolling off this assembly line every single minute and this is just the start of ford's plans to rapidly grow sales in china. that story coming up on "squashi"squawk on the street." ♪ [ shouts over music ] turn it down! and, of course, talk to farmers. hi. hi. ♪ we are farmers bum - pa - dum, bum - bum - bum - bum ♪ [ male announcer ] with wells fargo advisors envision planning process,

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and now to china, where else, where ceo mulally has placed big bets on ford's investments in the country by adding dealerships and the growth in asia. cnbc's phil lebeau is live in chongqing. phil? >> reporter: david, you know, ford's investment in china is one that a lot of people for years has said when is it going pay off because we're going on six years since alan mulally said be patient. invest heavily in china. look at sales over the last six years and how they have grown. in 2006 ford was barely on the radar in this country. last year, car sales totaled 421,000 factory and imports and transport vehicles and it was more than 600,000. in fact, ford sales in china are growing three times faster than the industry rate. in the first quarter they were up 54% and compare that with the industry growing at roughly 18%.

ford has passed toyota in terms of total sales in china which is why alan mulally is investing even more time on this country. >> we're the fastest growing brand. we're doubling our production capacity. we're bringing in all of the ford vehicles now and to have the diversity of chongqing and shanghai and guangzhou, i think it is a very good base for us to continue to serve the chinese customers. >> reporter: chongqing is the gateway to the western part of china. the fastest growing part of china's auto sales at this point compared to the eastern part of the country. ford doubling capacity here by 2015. this will become ford's -- it kren currently is the second largest market in the world and it will be number one by 2020. 40% of the the global sales will be here in china. still, ford has a long way to go to catch up with the market leaders. >> there's still quite a bit behind in terms of sales.

the dominant players here are, of course, volkswagen, general motors and hyundai is a story as well in terms of how well they've done. so ford is still behind, but coming on strong. >> take a look at ford shares, compared to general motors and its chief rival in the u.s. and the market leader here as well as vw which leads the market in china. keep things in mind, guys, while it is rapidly growing here and the asia pacific region is one where ford is still losing money and it lost $77 million last year and that's quickly changing and this is still a region when you look at all of asia pacific when ford is losing money and they believe with chinaya help it is changing quickly. >> we talk about china all of the time and there's no substitute for having eyes on the ground. great stuff. our phil lebeau in chongqing. how the price volatility is affecting main street.

we'll check in with one retailer who may be benefiting from the week. harvey kanter, we'll hear his take. you think you've heard the last of bernie madoff. we have the two behind the madoff documentary set to premiere at the tribeca film festival a little later. we'll be right back. [ tires screech ] [ beeping ] ♪ [ male announcer ] we don't just certify our pre-owned vehicles. we inspect, analyze and recondition each one,

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the market is falling away. we are now 137 points on the dow and there's a general consent about growth, commodities and the earnings haven't been kind today. bank of america is down about 4%. caterpillar in the wake of the downgrade is also in negative territory and apple is down, carl, almost 5%. >> all right. we'll dig deeper into the changing tides in the technology sector with one of the industry's pioneers. sandy lerner is the co-founder of cisco. she left the company in 1990 and in a sense launched a makeup company and entered the organic farm business and has written a sequel to "pride and prejudice" that she brought with us called "second impressions." you wrote the book under a nonde plume eva farmer.

>> i had no idea what i was doing, like everything else. >> what was the point of the book for those who are big jane austin fans. >> i just wanted more jane, and in the end after starting shottenhouse center and early women's writing i wanted to use those books and get immersed in that time which i did for 26 years. >> anybody who knows your name and knows cisco is interested in your thoughts about technology in general and the way in which the country is innovating or not innovating, building an infrastructure to innovate or not. you seem to have the view that we're not doing all we can. >> i know we're not. can you be more specific? elaborate on that. >> when i was in computer science and working the valley. all of the big company his labs, deck had a big lab, hp, ibm, apple, sgi all doing blue sky research and nobody -- it's --

to me it's a parallel with the business world. nobody has a long-term view anymore. it's quarter to quarter and nobody's willing to fund blue sky research. we are still reaping the benefits in a very big way of the blue sky research 20, 30 years ago. 20, 30 years it's not still going to be there. >> some people might point to a google who by all appearances is doing blue sky projects and cars that drive themselves, wearable glasses that will tell you where you are and where you're going. how is that -- maybe they can't do it on google's back by themselves. >> it's different. when we were in the valley it was blue sky research was technology research, and i think google is a great company and they're doing really cool things, but they're not doing things that are going to put us in the next generation of technology. people are trying to get to the moon and they're trying to do fun things and computer museums and blue sky research is about

research and it's about machines when i was in school. very, very different sorts of memory systems. so i think it's -- research is not all scientific research even though it has something to do with technology. >> you didn't just co-found cisco. you founded a cosmetics company that you sold to lvmh and you are now involved in organic food and restauranteuring. why did you write a book based around 18th century. why did you clearly have something to say? why are you not doing a cheryl sanberg in terms of encouraging women and why go so left field when you clearly know so much about what is going on? >> you know what? i don't think i'm in any particular field. i just got done speaking a couple of weeks ago to virginia independent business owners. you know, i'm thinking about writing something. i've been writing this for 26 years. now that i've got that off my

plate i've got other things i can do, but i think i will go out and talk about women because it's -- it's something that now i think people are ready to hear. >> what are you going tell them? that cher siyl is right, and whs there that view at the top of business? >> i've been thinking about that and when men were absentee fathers they never expected to come home to ballet and the little league game. why women think you can be at the top of anything whether it's ballet or, you know, acting or technology and do it part-time? i mean, these aren't part-time jobs. i think that's what separates the mentality of -- think is an

difference between men and women in busi. >> sandy, appreciate you coming by. the book again "second impressions" by eva farmer also known as sandy lerner. >> good to see you. bye-bye. >> materials suffering today. let send it back to josh. >> check out copper which is the red metal, copper. futures now at the lowest level since october 2011. the etf tracking copper which is the jjc now down 13%. and also freeport mcmorran ticker and taking a tumble and the copper mine hitting a new 52-week low down some 17% this year and down some 3% this morning. simon, back to you. >> thank you very much. in three minutes, breaking news on crude oil inventories after the 6% losses we've seen in the past week, will the data be enough to lift us back up? it's the number everybody is waiting for within commodities and it's after the break. plus, how is volatility in

bullion impacting prices. we'll ask blue nily's president and ceo harvey kanter. we're back after this. it's as simple as this. at bny mellon, our business is investments. managing them, moving them, making them work. we oversee 20% of the world's financial assets. and that gives us scale and insight no one else has. investment management combined with investment servicing. bringing the power of investments to people's lives. invested in the world. bny mellon.

sharon epperson at the nymex with breaking news on the energy department on weekly oil supplies. the energy department reporting that oil supplieses in past week fell by 1.2 million barrels and

crude oil supplies fell by 1.2 million barrels and gasoline supplies fell by 600,000 barrels. gasoline supplies were down by 600,000 barrels and we are looking at distillate fuel supplies that actually rose by 2.4 million barrels and distillate fuel supplies up by 2.4 million barrels and we are not seeing that dramatic a move, and we are seeing lower prices down $1 and we are below $88 ab. ray carbone, a veteran trader here on the nymex floor and ray, when you look at what happened with the build that we've seen in crude, the fact that we're still near a 22-year high in terms of crude oil, this is not that bullish a number with the decline. >> certainly not bullish as the api last night, and i think we have to look at the historical for the last three years running. we've had violent moves down. at the beginning of may it came early this year, but still, i think we may have downside to

go. we start stopped around at 77 last year and we're right in the middle. >> are you bearish in term of the global growth story whether it's china or europe and you can see oil prices go much lower from here? >> i have to think there's still more down side. keeping in mind some geopolitical problems. venezuela had an ugly election and aftermath, but still, i think there's more downside in the cards. >> you talked about $77 and the violent move that we saw last year just around this time. do you see that as the support level and the futures right now? >> it's a level i definitely will look at. we went from mid-90s all of the way down to the 77 level and we're right in the middle of that again and let's see where we'll settle and we have to stay bearish until we can settle there. >> ray carbone on the floor. i'll send it back to you, carl. >> i'll pick it up. it's not just the commodities

that are suffering today and we have another major leg down after monday's route. notice how technology is also taking a lot of the burden on the downside today. all of those major indices in the red. our next guest says it is a mistake to get to bearish here. he thinks stocks are headed higher. let's bring in chief investment strategist. welcome to the program. nice to see you. >> pleasure. >> it kind of feels as if something's changed this week for many of us down here. does it seem different to you? >> it remained me of the hunt brothers attempt to the fever market and silver took a real hard dive like gold did on friday. the real decline came the following session like it happened on gold on monday and they tried to hold things together the route resumed and with the margin calls that went out because of what was going in the commodities people had to start selling equities to cover their margin calls and it feels

to me like we'll go down to over 1500 to 1530 level and finally get a pullback which i think is a buy. >>. >> 1500, 1530 on the s&p. that's a big drop from here. >> in the scheme of things it's not all that big after the buying stampede we've had since last november. >> okay. but it is, as for as you're concerned almost like a technical problem that we have with one element of the market which is mainly gold? >> that was the cost a proximate last week and the news seems to be following with the market with the lowering of the growth forecast overnight tonight and the two areas i'm looking at are 15.44 on the s&p if you break below that then i do think you get the pullback into the 1500 and 1530 level and on the upside, if we can recapture the old all-time intraday high of 15.76, i think that would sound the all clear. >> so what is the strategy then, jeff?

what would be the major positions that you would pout? >> i would be looking to buy dividend-paying stocks and i talked about walgreen's when it was in the 30s. they made an acquisition that was misunderstood over in europe. it gives them the largest drug chain in the world and we think you get more foot traffic under obama care and my analyst has a favorable rating on the company and you take it on a stock-specific basis. >> are you excited by earnings season, jeff? >> not yet. this is the real onslaught. last week was really light on the earnings front and we'll have a better peg on that after the end of this week. >> for sure. >> jeff, nice to see you. on cnbc. >> from the markets to the growing world of etfs there is 1.5 trillion under management in the u.s. alone within the etf landscape and as etfs keep gaining ground they might make their way into your portfolio and bob pis any is here with his brand new etf portfolio tracker. bob? >> and i'm very proud of that,

carl. we've spoken about exchange-traded funds and the role they might play in their portfolio and we might take this to another level and we'll show you how to use etfs to build a retirement portfolio so we brought in six independent etf experts including five financial advisers that use etfs exclusively to build three retirement portfolios that we are rolling out today. the site, retirement.cnbc.com. now these portfolios are based on age. there's a portfolio for a 30-year-old. there's a portfolio for a 50-year-old. there's a portfolio for a 70-year-old. each etf portfolios could have up to 18 etfs in it with different weightings in each of the portfolios, but they're broadly divided into four asset clashes, first cash, then stocks and bonds and's tactical group that can include it in commodity etfs. it is based around core holdings.

this is very difficult, an bond etf.onal stock etf s the core stock we're using is the spdr 500. spy. the other one is the vanguard all world. this covers 2,000 stocks in 46 countries outside the united states. broadest you can get and the i-shares total u.s. bond market. here you will own treasurys and munis all in one etf. by varying the weightings in the etfs and more toward bonds when you're older, you can develop a portfolio that grows and ages along with you. there's more to it than this and we're just scratching the surface and there's real estate and commodity and cash etfs involved, as well. it's all up on the website and retirement.cnbc.com. you'll be able to see the etfs as well as the reasons the council included every etf and it's not static. you can see how the portfolios are performing in real time like this one.

here's a shot of the wall here. this is the etf portfolio for 30-year-olds. there are 15 etfs in them and i'll explain to them what's in them and have one of the council members on and the fast money halftime report will go into the etf portfolio. it's all part of the effort to help you toward a more prosperous life and prosperous retirement and i'm so happy to roll this out on financial let rassy month and hopefully this will help a little bit. >> you've done a lot to change that, great stuff. our bob pisani. >> blue nile president and ceo harvey kanter. what does it mean for his specialty business? we'll find out after the break. my mantra?

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from online jeweler blue nile on how they're dealing with gold's fall and what that means for jewelry prices. here for a cnbc exclusive, here's the president and ceo harvey kanter. is it good for business, bad for business or neutral? >> okay. we seem to be having some technical issues. harvey, can you hear me? >> i think we'll look at fairway. ticker symbol, of course, is fwm. that was above the range and opens with about a 39%, 38% gain to $17.94. again, a grocery chain heavily focussed on the new york city market if you don't know already. people talk about the debt load quite a bit, david, which i don't know a lot about and a new issue has gotten that controversy surrounding it. >> it's private equity and they

have a good amount of leverage on the balance sheet and they are expanding rather quickly as you point out. known in the new york area and a plan to roll it out throughout this year of the country, certainly and they have been doing that and suffered losses in brooklyn which sort of impacted them, but wow! that is quite a reception. >> let's see if we can get back to harvey kanter who is the ceo of blue nile. i think we fixed your audio problems. harvey, can you hear me? >> i can. thanks for having me back on the show. >> you're very welcome. really, we wanted to get a sense as to what the move in gold is doing for your business? is it a positive because prices come down or does it have any impact at all? >> we look at it well as our model and we put that in place yesterday and no better time at this moment to buy gold jewelry

than at blue nile. what is the lag time in terms of the actual price of the precious metal and let's call it on monday when it came down enormously and your customers seeing that online. >> our model is flexible and our turn over is significantly greater than the brick and mortar guys so we've been able to take a reduction on the price of the jewelry, and more importantly, the the new order will come in at the lower price. so we have res deuced prices as of yesterday by 10% on all gold jewelry. if you're somebody creating the jewelry and you're buying it ahead of time. i'm curious as to where it comes out. is it for you or the maker of the jewelry or everyone benefits because of the lower price. >> when we buy the jewelry is that's based on the time. and the new order will come in at the reduced price with the new gold pricing in place. >> do you hold any stocks at all? >> we do hold stocks, but unlike most traditional brick and mortar stores, we're very lean

and the inventory gives us much greater visibility. >> as you've already told us that you've taken a 10% cut on the prices of the stock. can you tell us what the financial hit will be? >> what we expect to be is turn the inventory much faster and accelerate sales and ultimately buy the new inventory at the lower price. it's more specifically. >> any historical comps in terms of what a fall in gold has done in the past, perhaps, to your business or is this a new environment for you given that we haven't seen anything quite like this in some time. we see the consumer's constant appreciation of the market and so what we expect is to see the historical movement of the customers buying into the value that we bring with with the reduction of prices on gold jewelry. >> don't you worry, mr. kanter, that you may be seeing a sea change in the way people view jewelry and gold in particular, that it may not be a one-way bet and it may not be a store value as many people have conspicuously argued for so

long. >> it has been significant and meaningful and most of our product is much more classically updated and they look at it as an investment and so we think that the reality is the consumer appreciates what we're bringing to market and the volatility of the gold is momentarily, but the consistent appreciation of gold is what they really appreciate the most. >> all right, harvey, we'll leave it there. harvey kanter, ceo of blue nile and our apologies for the audio problems in the beginning of the interview. >> no worries. thank you very much for having me on. >> have a great day. >> we'll check fairway here as it did open at 18 and pricing at 13. sales last year, guys, were $554 million. debt about $203 million and that was as of last april. 65% of their sales come from produce, organic items and prepared foods. as anybody who shops there would know, one of the few grocery stores where you actually put on a jacket to enter their giant freezer section. you know that, david? >> up on 125th street.

that's always a fun one for the kids. >> you have to put on a jacket from somebody else's -- >> yes. they all hang on big hooks. >> moving on. has the 'em had its fill of austerity issues? wednesday morning on cnbc. both tylenol and bayer advanced aspirin

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take a look at apple shares. they're getting shah the supplier is down 12% on disappointing numbers. there is concern. you don't need me to tell you the first quarter numbers are not going to be great. perhaps guidance for the second quarter will not be particularly good as well. how much is already reflected in that price spot? the high back in september is right around 700. market capital for $650 billion. google and then some. of course, data points on apple, but we'll see. and cash. are we going to get close to a market cap that's half cash? >> a lot of interesting points to make on apple as we watch shares continue.

>> let's get to cme this morning. rick santelli with a wednesday edition of the santelli exchange. >> i'll tell you what, carl. it's just amazing to me how there's a harmony with respect to certain strategies that all seem to koeless at opportune times. the new threat is austerities are horrible. and it totally makes sense. whether you look at the pictures of many european newspapers you see there's unrest in countries like ireland, who are just not into public workers having any of their pay cut. whoever is going to volunteer for any type of reversal. we see portugal's high court is at a crossroad. it's really going to make is issues regarding austerity unconstitutional. we see the situation in greece

detier yeer yoriorat deteriorating. anybody with a brain should realize austerity is fot a good thing unless it's paired with reform and ultimate growth measures. now i want to ask you, carl, because you have talked about it. what have you walked away with for growth? any thoughts? >> i heard one person call it the most monumental excel in history. i don't know the early take has been if you're ghoing to be accused of taking a miscalculation, that's not what we were trying to say in the first place. >> well, it reminds me of cold fusion. but yes. and the point i want to make is three-fold real quickly. first, i wish the institutions

would spend 120one-twentieth ofe time. of course, the sample size and study with seven countries with small. here's the key that everybody is missing. they put it out in their own statement. no matter what you think the number and errors or how they treated new zooe land for a certain number of years, these models have zilones zillions o assumptions. the deterioration amounts to 25% from trend growth. if you owned a company and says, ah, it doesn't matter. it's only 25% trend growth, they would fire management. the study is important. they have errors. let get to the bottom of it. back to you. >> he's back. this time he's on the silver screen. bernie madoff. the documentary is up next.

i was always worried that bernie would need something the minute i trashed it. >> and that was a clip from a highly anticipated documentary on bernie madoff entitled "in god we trust" set tod debut friday night. it's the story of his long time personal secretary. the film was directed by victor and derrick anderson who join us this morning at post 9. good morning. >> good morning. >> we're talking about a story covered from top to bottom for years. how did that happen? >> well, we met the secretary a few months after bernie's arrest actually and she's been on this quest for justice ever since. she sort of unearths the real truth behind the headline of what really happened. >> the real truth being? >> being -- do we have 90 minutes? >> and there was just a lot more to the fraud than was reported.

i mean there was a lot of money laundering. a lot of window dressing for much bigger crime. >> what sort of emotion do you come out of the film with for him and for him? >> for her, you're inspired. this is a woman with humble beginnings. it was her only job for 25 years. >> if madoff is sitting in prison saying the major banks knew, she must have known. >> and she didn't. what's amazing is there was a tiny handful of people that worked in the company. they were sequestered away, running a different division of the country. they were involved. the others didn't. some of the trials -- actually the first trials in the madoff scam were coming up in october for the coconspirator who is participated in the crime. >> that's part of why she feels responsibility.

she feels she should have known, but she didn't. >> how much do you take the rest of wall street that always watched with suspicion for not acting on those suspicions? >> i think it's unforgivable. i think investors are probably struggling with confidence because of that. it's hard to explain away. >> how difficult was it to get players to cooperate? >> very difficult. most people did not want to come on camera and speak. for fear of saying the wrong thing or couldn't afford to lawyer up and make decisions. so it was tough. >> and he's been vocal from prison, derrick. any response from him? >> not specifically to the film. though it wouldn't surprise us because he has been so vocal. >> are you going to send a copy to him? >> i haven't thought about it. maybe. we should make him wait for pay-per-view. >> congratulations again.

we look forward to friday night. if you're just tuning in, here's what you missed earlier this morning. >> welcome to hour three of "squawk on the street." here's what's happening so far. >> bank of america is reporting the top numbers. the first number that they are giving is 20 cents a share. >> we have challenges in the coal market where inventory is high. if we exclude coal the other revenues are up 5%. >> if we were to forget about europe and look at asia the futures would be up. i think there's more to life than just looking at europe and selling down the futures do you

junk up your ads and make a few more bucks? she's going right. she's terrific. i love this call. >> nobody has a long term view. we're still reaping the benefit of that blue sky research 25 years ago. >> it's a great positive. we've been able to reduce gold jewelry prices and put that in place yesterday. >> good morning. welcome back to "squawk on the street." looking at another sell skrn off on the the dow,that is now down 177 points. first some breaking news on google this morning. mary thompson is at hq. >> carl, the company is issuing a statement in light of the company having delays or can't access the more popular applications. the company is saying we're

investigating with gmail, drives and docs and providing more information and updates on the status dashboard. they plan the route cause when the teens have completed their investigation and in the meantime google apologizes to those users that were affected. >> big news for good l this morning as you can see. good morning. we are live at post 9 looking at the markets. the gain yesterday is now completely lost and then some. the s&p has broken some some, what some are calling critical levels at 1,557. we're now down to 1,548. apple continues to have a rough session. bank of america reporting lower than expected earnings. the bank expected to boost the core growth of lending business.

jpmorgan and goldman also sliding on the news. let's look at the markets on oil and gold. dan, good morning to you. >> good morning. >> there's a question of how much dan is being being enflikted but also how much damage is a result of the volatility that we're seeing this week. three straight days of triple digit moves. we haven't seen that since february. >> i guess this is the correction that everybody has been talking about for the past two or three months. if you've been waiting for it, you're sitting on the sidelines. there has been some done to the charts. no question about it. i think we're going to enter consolidation here. nothing has changed between now and last week or the week before that. we still have the same issues. there's no place to go but equities. people don't have much of a

choice. sometimes it's no more complicated than that. >> you talk about volatility. having been in a kweez as we continue to watch the vicks. is that changing? and is that long lasting? >> i don't think it's going to be long lasting. it definitely changed. it started ticking up a couple of days ago. it always moves inversely to the market. but it's at really historic lows. this is really the new norm. so i think you're focusing on it too much. so many have nothing to do with the volatility index, and that's what people should really be looking at. >> your view on gold, dan, is we are not going to move back about 1500 in your words, for a long, long time. >> yes, i think gold is broken.

i still own gold. it's such a minor part of the portfolio that it doesn't get my attention really. gold peaked about a year and a half ago. we had a really high volume reversal. up and back. that's a monthly chart. since that time gold has consistently bounced off 1,500. but it's been getting weaker and weaker. so the buyers have been in there, but they've been weak. finally we got a break down of the really key level. once that break occurred and it's on such heavy volume, you're not going to see that come back up for a long, long time. because there's just now too much supply. and then this gap between friday and monday, very, very damaging. >> yeah, and we had short calls on gold. i'm thinking back to reports a couple months ago arguing when

gold moves the trends tend to be very long term moves. it doesn't spike the way you would spike back or retrace on equities. >> gold is really viewed as a separate asset class for a lot of folks. so you have big macro trends in the market. there's been so many reasons and there remain so many reasons to be in gold. currency debasement on the planet earth. fear of inflation. that time of thing. but the chart is telling you that none of that is happening. so because of that you're going to see people just flying out of gold. you can hold onto be right or you can make money. they're getting out of gold and they're getting into other equities, basically. >> finally, dan, on oil, not

quite the lows from monday. but do the charts tell us anything about whether we may see continued declined on crude? >> you know, i've heard so many folks on cnbc the last few days talking about the demise of oil. and it's not done going down. i don't really see it that way. this has been consolidating an up trend for years. technical term, smymmetrical triangle. right now with oil at 88. support is down to 85. and so i just think it's wrong. you're expecting the unexpected. if you expect oil to continue to go down. and it's just about 3% above where support is. i think you have to wait. would i buy oil now no. you look at the energy companies. look at the xle, the xop.

all of those are broken. they have been broken. but they're closer to support than resistance. so i think if you're shorting oil, you're really taking the opposite side of the trade that i believe is going to be correct. i would buy oil if it came came down to 85. absolutely. >> interesting charts. that tells at least one story. dan, thanks so much. appreciate it. >> my pleasure. thanks. >> keeping our eyes on shares of apple in the meantime. 406. that is down $20. a fresh 52-week low. is this a sign of more weakness to come. what mig we expect from the upcoming q2? we'll be right back.

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dow down 183 here. take a look at technology on the s&p. down sharply. obviously more than 2%. apple is a big reason that it's in the red. let's send it back to josh lipton. and unfortunately if suppliers. >> absolutely. we're talking about apple getting slammed today. analysts saying the catalyst is the negative preannouncement from apple supplier. which they say confirmed lower iphone demand. but it's not the only apple supplier getting hit. i was talking to analysts. they say they are getting hit on apple.

linear technology, the chip maker lltc saying their outlook for growth in the june quarter was lower than expected. that's always having an impact. >> they are saying we blame ourselves for being attracted to the earnings relative to the share price for so long. people knew apple's inves toir was becoming an issue. as we make the transition on ipad and iphone, what h that will mean to products in the near term. >> and quicking talking about fundame fundaments. he tells us of the levels we should be watching here. 400 and 365 is the next one. carl, back to you.

>> 406 is definitely going to get your feangs as we blew our way through. apple is hitting new lows. it's weighing on the nasdaq hey, seema. >> we are seeing the stock lose 4.5% of today's trade. hitting a fresh 52-week low. it's now trading well below. of course, something that market technicians watch very closely. also apple could see a 20 to 30% quarter to quarter drop of mini shipments seems to be weighing on the stock as well. apple does report earnings on tuesday. now apple has shed more than $250 billion since the stock hit the all-time high of 705 pack in september of 2012 when the iphone 5 went on sale. apple shares weighing heavily on the nasdaq. below the 50-day average in

today's trade. that is something we will continue to watch. >> interesting. and with the goldman comments today, sema i heb a few weeks ago when they took them off the conviction buy list, they kept the buy in place. the bears would argue there's still sentiment that needs to be drawn out of the stock. >> it also seems like we have seen this story before. a lot of cautious commentary from analysts right ahead of apple's earnings report. it will be interesting to see if apple can come up with some good commentary. >> gold man's target is 575. that's well above well we are today. what do a high profile new york art dealer and a russian mob boss have in common? a lot more than you may think. plus the app bringing transparency to the

attorney-client relationship. first rick santelli with his own takes on today's market moves. carl? >> insider trading is a big topic on the trading floors. these people down here do a wonderful job on the straight and narrow. but in november of 2011, "60 minutes" ran a piece about insider trading issues in washington. and there was legislation that followed. it was defamed majorly. r robin kendri is joining me in five minutes. ♪

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with jmp securities. he joins us on the news line this morning. thanks for coming to the phone. >> thank you ch it feels like it's trying to find legs here. what is your very near term view? >> i think the problem for apple today is we have a major component provider cirrus talking about inventory build and guiding down pretty hard for the forward quarter. they are intensifying competition. i'm not sure you're going to get a lot of near-term relief from apple. >> are they telling you anything you didn't already know or suspect, alex? >> i think the magnitude is worse than what people were thinking. because i think you're absolutely right. people were braced for a poor seasonal quarter. but the magnitude coupled with

the success that samsung has in the market. it has investors nervous on this stock. >> it's amazing to look at the year to dlat losses on apple. 20 plus per cent. it's just a fluke of the calendar, perhaps. can they work their way out of this prior to the launch of new launches in the next year? is that still about a statement regarding cash? >> i think it zuz require the launch of new products. there could be some help in increasing the dif dent. i don't expect that until the second half of the year. we need a new iphones comes out. we need more economics.

not necessarily new market categories yet, but new products for sure. >> so they are hoping for some out of the blue announcement about cash redistribution. you think those hopes are fallow. that it's really going to be about the transition that we have to wait months and months for? >> i think it's more important one. you have to be confident in their ability to sustain it. >> just thinking back to prior transitions. whether the iphone or the ipad. your current products are vulnerable to certainly competition. have it ever been this pronounced? >> no, it hasn't been this

pronounced. i'm speaking to component pricing. we have pressure from touch screen supply. so all of the issues are creating a land scale that's very different than what we have seen before. thank you very much, alex. we'll see you next time. >> thank you. >> john harwood has breaking news. >> the breaking news is a letter containing a poison was also rereceived by a screening facility headed to the white house. it appears the threat that was underscored yesterday is broader

than that. we now understand the letters were headed to other senators as well. involving senator shelby of alabama and now learning about this letter, our pete williams has confirmed that was headed towards the white house. we don't know whether this is related to the attack on the boston marathon. after 9/11 we had the threat of anthrax lertds. more than just a threat. a couple of people lost their lives in washington, d.c. turned out not to be related to the al qaeda attack on new york and washington. everybody is on a mump higher level of alert. we are going to see what the threat is about to the extent that authorities can learn it, carl. >> well said, john. certainly given some of the false positives we know related to the wicker letter, we're going to have to continue to

watch it for further developments. let's get to rick santelli this morning and check on the markets. hey, rick. >> hi, carl. my thing this week has been that when you have very complicated issues with ha lot of regulations and rules, the murkiness, well, it's about interpretation for those you see eye to eye with. it's about strict enforcement for your foes. hey, rob. the big issue on the trading floor the last couple of days is what happened to the inside trading law that was really a big deal when the president gave the state of the union. >> well, this originally became a issue on 60 minutes last november. the president took it up and made it a big deal in the state of the union address saying we

needed transparency and congress had to stop insider trader. and it basically involves 20,000 ples. >> so we're not talking 135 in the house. 100 in the senate. two in the white house. we're talking how many? all the employees. people at the treasure ary. all these people that do transactions they no longer have to post in information on a clear and present website. >> this goes all the way back to 2007, 2008. so where did that come from? who said we are going to combat this with the trade themselves. >> well. it was a good concept to get it out there and clear. >> that was originally in the

law. >> absolutely. it came out of the fact that some congressman benefitted greatly. >> i'm telling you what, once again sbrept for friends, enforce for foes. i'm sorry. people down here do that stuff they're going to be in an orange jump suit playing basketball on the top of a building. now what did they put in its place that they passed and signed quiet ly. >> they will have to inform them. it may not come up for 45 days. the law originally stated it was supposed to come into effect within 45 days. it would finally take effect on april 15th of this week. and congress last week. the house and the senate passed the retraction of the bill in 20

seconds. and president obama signed it. they did it because of natural security. >> also, believe me. doi ent care about this issue. several newspapers about six months ago printed who owned guns in their addresses. where is their concern for security? two sets of rules. don't like it at all. >> rick santelli in chicago. bells about to sound across europe. they had a wild session. especially in germany today. we'll get details from simon right after the break. it's lots of things. all waking up. it's lots of things. connecting to the global phenomenon we call the internet of everything. ♪ it's going to be amazing. and exciting. and maybe, most remarkably, not that far away. we're going to wake the world up. and watch, with eyes wide,

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there was a moment today where the dax fell almost 2% in about ten minutes. what's going on in europe? >> it's a very rough day in europe. a jolt of reality is the degree to which the european economy continues to fall away or the stock markets break down where you have relative stability in the united states. overall across europe the top 50 stocks are down just today. 2.2%. one of the major reasons, one of the major realizations of how bad it was when they were the head of the bank. suggested yes, there could be interest rate cuts to come and you see the way the euro has

tracked lower. this is a big move. the pound is down as well. there's concern about unemployment in the yipted kingdom. so whan began theday or the session as a selloff, a continued selloff in the mining stocks has really gone across the board. let me take you to the german market and show you what's happening there. bios within chemicals. let's go to france. the big french banks are down as we look at detoor yor rating economic situation. down over 4%. and that's really picking up the fall that we've had. this is a russian miner that has lost now a third of its value in about three sessions. i want to give you an indication

of what is happening in europe. no clearer is it than on the papers tham came through for march. overall across the european union the fall is 10% year on year. but look at germany over there on the left. german car baying is coming to an end. the uk is on its own with a slight rise. but it is an indication of the state of the consumer. particularly in germany and france when you see car registrations down. back to you. >> the car registration boggles the mind. >> and the ceos coming to play catchup. what do you do with the capital and commitment? >> the gold and oil stories continue this week. sharon is with us. >> hi, carl. we are looking at gold prices under $14 an ounce.

it seems gold has steadied after the unprecedented selloff on monday. the groebl growth story worries traders and investors. despite the depressed point we're seeing for futures are soaring. we're looking at april sales in a record level. but it seals to be even keel according to the gold dealers. we're also watching what's happening in the copper market. we are looking at copper prices and the copper etf down 13% so far this year.

goldman sachs says we are looking at loier prices in crude oil as well. with same with wti futures. after we did get the data from the u.s. energy department it showed a decline. but we're still near record levels for oil supply. >> thank you for that. it continues to be and main story that we're watching. they're throwing out o lot of babies in bath water. just take a look at what we had this week. heaven knows where we're going to end here. you get blown out and one day or

another, depending on what side you're on, it's hard to stay on the right side. maybe we'll get a bounce. here we are coming off the lows here. heaven knows what was going on with that jer men open. maybe things will calm down in the united states. obviously some selling still over here. nyse, new lows. the highest level that we have seen since november. it's not titanic. it's noticeable. we are starting to see lows this week. interesting comments this morning. margins, margin debt approaching all time highs at the new york stock exchange. that's important because just like with cold deleveraging. stock deleveraging can occur with high margin debt. so pay attention to when things start moving down like this. that can be a contributing factor in what's moving here. take a look at the sectors here. it's very rare here.

when you get better than 1% declines in all the major sectors health care is down 1%. sharon has been talking about this, we have commodities at or near 52 week lows. copper, aluminum, nickel, all sitting essentially near two-week lows. every stock is a whodty name. these are names that you know all about. all of those are at 52-week lows. there was an interesting point about individual people coming and buying gold coins. it's an interesting idea but there is just not enough out there. the women of india, the biggest

buyers in the world. there's already reports that nair flooding into the bazaars in mumbai. that's going to turn things around. how about deciding that gold is at the the bottom? take a look at the the bond etfs. agg is the one really hitting new three-month highs right there. that's the one to watch. that's a sign investors are becoming more defensive. >> thanks, bob. bob pisani. getting new details about the devices used in monday's bombings. investors say the hunt for suspects is wide open. scott cohen is live with the latest. hi, scott. >> hi, carl. in a situation surely feeding into the jitters of the financial world and beyond, let maine give you the latest on what is going on now. we're not sure what to make of this.

the route of the marathon and the attacks that is two blocks behind me. what appeared to be mostly fbi evidence, technicians, atfs as well that have been just going through -- just combing through the whole area. they're going through trash bins. they're going through port-a-pottys. they're looking under cars. does it mean there is some new clear? are they doing some big sweep before they block off the area? we'll get a news briefing from all the agencies involved at 1:00 eastern time. most recently the fbi was still appealing to the public for health. >> we are asking anyone who may have heard someone speak about the marathon or the date of

april 15th in any way that in t indicated he or she may target them. someone know who is did this. >> one knows who did this but does law enforcement know? they say there's been a tremendous response from the public so far. and they're continuing to keep tabs. the next news briefing is 1:00 eastern time. >> scott, thank you very muff for that. we'll find out what stocks they are watching today. a lot to choose from when we come right back. but we can still help you see your big picture. with the fidelity guided portfolio summary, you choose which accounts to track and use fidelity's analytics to spot trends, gain insights, and figure out what you want to do next. all in one place. i'm meredith stoddard and i helped create the fidelity guided portfolio summary. it's one more innovative reason

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welcome to the earnings squad. i'm melissa lee with my earnings squad partner. we are joined by kate kelly. we have to get to the score card here. 11% of companies reporting so far. 6 6% beat their targets. 27% have come in below forecast. we have a market selloff on our hands. the worst of the three major averages, the nasdaq. the chip stocks. the index severely underperforms this morning. and we got earnings reports. we got a warning from cirrus. let's start with intel since it's the bigger caps of the

nasdaq stocks here. sbel coming out sticking by the 2013 guidance. you know about managing expectations and the problem is expectations in terms of guidance, a lot of analysts say too optimistic. >> yeah. they have so much to prove. yesterday we were talking about margins. if people don't have faith in you you have to knock it out of the park. we have not seen that in this decade. a lot of people are saying is this simply built on home? when you have that language, it's never good for the stock. also take a look at cirrus. very bleak forecast. one of the mayor customers is

apple. goldman taking off the conviction buy list also. >> apple is an interesting story. it's the elephant in the room on a day like today. he thinks the expectations are so low that that's very good likelihood. either on revenue side or in financial engineering. this is the argument. they need to do more with the cash on the balance sheet. >> le get to financials here. bank of america is certainly not helping. what is helping here? >>over all they had an earnings miss. they're cleaning up some things. but they still have mundment fall weak fundamental weakness. i was just looking at the elite tables.

they're really in a poor spot in many quarters. even worse in some. the banks has not come together despite the respect for tom montag and sales in trading is spotty. sales have been weak where they could be stronger. i know some investors with longer term goals. >> we have to take a break and send it back to krorl with breaking news. >> want to take you to washington, d.c. for breaking g news. >> i want to bring you up to speed. we have three separate security incidents going on at the same time in washington. in the past couple of moments, got an e-mail alert telling to avoid the third floord of the senate office building. that's an officer where the senators and committees have facilities. they're dealing with some kind of suspicious package in the third floor. avoid that area.

also just behind me here. i'm in the another of those office buildings they're dealing with a second suspicious package incident in an office here. police tell me there's a suspicious package down here that cleared the hall way out just behind me. also the secret service confirming a second suspicious package possibly linked to that incident was sentd to president obama. that was picked up in the mail facility that the white house has. so to recap, we have now two security incidents going on right now involving suspicious packages up here in the hart building and also the russell building. staffers here are being told to avoid the third floor. >> nbc news is reporting capital police are reporting a suspicious package at senator

shelby's office. we have a bunch of fires, so to speak, regarding security developments. >> that could be the office down the hall. we could not see which senator's office it was in. we are in the russell building. they do have this hallway blocked off. pete williams is reporting that federal officials say they believe they know who sent the letters to st senate and the white house but no arrest has been made yet. they're waiting for test results. >> we're going to hear from jay carney sometimes in the past few minutes about either boston or developments in washington or both. just as someone who reports to the area every day, can you give us an idea of how different security looked? >> it doesn't have the mi militarized feel. yesterday we had a parade that didn't appear that different at

all. today coming up here to capitol hill all of the trash cans in the parks have been taking off their bases and knocked over on their sides. clearly they're going to go around and collect those and provide one less place for somebody to hide a gis and staffers are feeling jittery. we have a couple of these incidents. you can imagine people are on heightened alert. a lot of peoplery saying it feels reminiscent of the post 9/11 era. >> don't go too far. they think they may know who sent at least some of these letters. can you add anything to it? >> as you said, they believe they know who did it. we heard from one senator, not rog rog

roger whitaker, who was the reported target. it appears to be somebody who sends a lot of letters no senators. to people who are familiar with the mail coming into the offices. there are a lot of false positives associated with that. we don't know for sure what that was. we believe it was not related to the boston bombings and is reminiscent of the anthrax attacks that occurred after 9/11 that were also not related. >> pete williams points out that it's made from caster beans. in a lot of the mailings, they simply grind up some caster beans. that could result as a positive field test. that's an important distinction to make, john. >> exactly. the equipment that they use to

test these things in field examinations is not as sophisticated and thorough as the stuff that they have for the thorough tests at the office. so i think that's where we are. trying to figure out if this is really what it was. the more this is a frequent correspondent with politicians in washington, one might suspect that maybe it wasn't the most damaging possibility, which is that it was real, you know, highly toxic material. but we're going to wait and see the results of those tests to find out, and we'll hear in a few minutes from jake carnety, the white house press secretary, who's about to brief reporters at the white house. >> john, clearly the story today, all week long, is security. no one's doubting that, and hopefully we get some insight and information regarding boston and the developments in washington today. but just as a side note, it does seem to have displaced any discussion we would have had ordinarily about guns today, about immigration this week. i guess how does -- how does the

hill sort of operate around that? >> well, the hill is moving ahead with these gun votes, at least at last report they were, this afternoon. we expect the manchin-toomey background check compromise to go down. we're hearing one senator after the other who'd been on the fence saying they're opposed to it. so if anybody thought there was a post-boston moment where causes that were moving and had some push from the white house were going to get people to pull together behind them, that is not taking place on that issue. however, on the issue of immigration, i think there is a widespread expectation -- we'll wait and see if that's borne out -- that that is an issue moving down the track. whether it's interrupted temporarily by security concerns or not. and remember, the details of this bill are being rolled out this week. they've been negotiated by eight senators from both parties. we don't expect action until may/june on those issues anyway.

this is only a bump in the road for that. >> a good point, john. thank you. thanks to amin as well. if you're coming to the new, again federal officials telling nbc they believe they knew who sent these letter, suspicious letters to the president and some senate offices. also senator shelby's office confirming the existence of a suspicious package. jay carney will speak at that lectern on the other side of this break. [ male announcer ] there are people who find their own path. and never back down. who believe the american dream doesn't just happen, it's something you have to work for. ♪ we're for those kinds of people. because we're that kind of airline. and we never stop looking for a better way. it's how we've grown into america's largest domestic airline. we are southwest. welcome aboard.

take a look at the markets here. we were down close to 200 points in the early part of this session. currently down 142 on the dow. s&p's down about 24. we broke a level right around 1,557. some of the bulls appeared to get a little more concerned just on technical damage. we're at 1,550 now. down about 24 handles. the nasdaq is where a lot of the pain is centered today, largely because of apple. we were at 421 at the open. fell down to 406. this comes after both lazard and goldman said that the coming quarter actually not just the march quarter but the june quarter numbers may still need to come in from consensus because of the product transition on the ipad and the iphone, as they wait for these new products to come in the second half of the year. we talked to an analyst who said if you're hoping for a comment on a dividend or big buyback, that probably isn't likely, at least for several weeks after they report next week. take a look at bank of america. financials not a big help as well.

not only a miss of 20 cents versus a 22-cent estimate, but litigation expenses took a big bite out of that stock at 1159. keep in mind, bank of america is up 40% in the past 12 months, and fairway, one new issue, big grocery chain centered in the new york market, priced at 13. that was above the range. it opened at 18, settled back a little bit, and still a nice gain there of a little more than 27%. we are waiting for white house spokesman jay carney to come to the lectern at the white house. a lot of developments regarding security in the hart senate building, russell building. hopefully, some information about any investigation about the boston marathon. we'll wait for that presentation to take place, and in the meantime, we'll take a quick break. i know what you're thinking...

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